Home purchases by foreigners in the US

What is the profile of the international home purchase activity in the US?

About a year ago I mentioned some of the characteristics of the types of properties foreign buyers were buying, depending on where they are from.  This blog here is more general in nature and shows how much, globally, each country participated in the buying binge in the US.

An image is worth 1000 words...  the National Association of Realtors put out a study and infographic that says it all, entitled:  Where are most international buyers from?
Please check out the NAR's  2016 International Profile.

.. which translates in the following figures:

Thank you for reading,
Francis

Silicon Valley real estate specialist
Price your property
Detailed, local trends etc...
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Foreign buyers - California - US

The number of sales to foreign buyers rose once again over the past year, although international buyers are shifting their preferences from luxury homes to less-pricey properties.

NAR (National Association or Realtors) economists think the change in the price of homes international buyers are after may be due to overall higher home prices, along with a stronger U.S. dollar, which both cost foreign buyers more these days.

“Weaker economic growth throughout the world, devalued foreign currencies and financial market turbulence” all had an impact on foreign buyers over the past year, said Lawrence Yun, NAR’s chief economist.  “While these obstacles led to a cool down in sales from nonresident foreign buyers, the purchases by recent immigrant foreigners rose, resulting in the overall sales dollar volume still being the second highest since 2009.”

Foreign buyers purchased $102.6 billion of residential property in the U.S. between April 2015 and March 2016, according to NAR’s report. The number of properties purchased rose 2.8 percent to 214,885. The value of homes bought by foreigners was typically higher than the median price of all U.S. homes.

Experts say a slight drop in dollar volume is due to the types of properties purchased, and the locations of those properties. There are signs that foreign buyers have begun looking beyond higher-priced markets like San Francisco and New York to purchase properties in smaller, less-expensive cities in the Southeast and Midwest.

Chinese purchasers continued to outpace all others, with their dollar volume exceeding the total of the next four ranked countries combined. Their dollar volume of sales, at $27.3 billion, was three times as much as Canadian buyers, who were ranked second. Chinese buyers also bought the most expensive homes at a median price of $542,084.

Five states accounted for half of foreign buyer purchases, according to the NAR report: Florida, (22 percent), California (15 percent), Texas (10 percent), Arizona and New York (each at 4 percent).

 It is interesting to note that California is home to about 25% of all of the foreign-born population of the US.  Florida has only 9% of the foreign-born population of the US, as shown on the graph below:

 

Thank you for reading,
Francis
 

Silicon Valley real estate specialist
Detailed, local trends etc...
Current mortgage rates
A worthy local non-profit to remember: Community Services Agency in Mountain View.

Offshore Buyers Continue to Invest in Bay Area Real Estate

From our Coldwell Banker desk:  

2015 was another very strong year for foreign investment in U.S. real estate, especially here in the Bay Area and particularly from Asian buyers. 

The dollar volume of all foreign investment in the U.S. reached $104 billion for the 12 months ended March 2015, up 13 percent from the same period a year ago, according to the National Association of REALTORS®. More than half of that investment went to California and three other states – Florida, Arizona and Texas.

No one knows for sure exactly how much foreign investment there is in the Bay Area housing market, but anecdotal evidence from our agents and managers in the field tell me it is substantial. And it's probably not surprising, considering the fact that the Bay Area has long been one of the most sought after housing markets for Chinese investors and other offshore buyers.

International investors are attracted by the strength of our local economy, particularly the tech sector in Silicon Valley. They also favor the stability of the U.S. political and financial systems, our strong schools and world-class universities like Stanford and Cal, solid appreciation on homes in the Bay Area, and the relatively affordable prices - yes "affordable" - compared to many other major cities around the world.

If you have any doubt about just how fast Chinese and other Asian investment is growing in the U.S., consider a recent NAR study that found Chinese buyers were the number one international investors in U.S. real estate over the past year with $28.6 billion in sales volume, nearly three times the number two country, Canada. As recently as six years ago, Canadian investment in the U.S. market was more than double China's, which also ranked behind India and the U.K. and was at the same level as Mexico.

In recent years, Coldwell Banker has deployed a very targeted marketing program to reach Asian consumers in a variety of media outlets, both print and digital. We are reaching out to buyers and marketing properties on many of the biggest Asian websites and publications. In addition, our strong international network of offices and agents – the most of any U.S. brokerage – has helped us attract more offshore buyers. Given the interest in the Bay Area housing market from Asian investors and others overseas, I don't see that trend changing anytime soon.

Thank you for reading!

Francis

Silicon Valley real estate specialist

Detailed, local trends etc...

Current mortgage rates

A worthy local non-profit to remember: Community Services Agency in Mountain View.

Foreign investments in the U.S. real estate market.

Foreign investment in the US real estate market.

Year-in year-out Realtors in the Bay Area deal quite a bit with foreign buyers.  It is interesting to keep some perspective on this phenomenon at the national level.

From March 2013 to March 2014, foreign purchases in US real estate increased 26% from the year before, to a total of $92.2 billion (National Association of Realtors Profile of International Home Buying Activity).

4 states accounted for 55% of the total: Florida, California, Arizona and Texas.

Nearly 60% of reported international transactions were all cash, compared to just one-third of domestic home purchases.  - Still 1/3 is an impressive number!

54% of all international transactions last year came from Canada, China, Mexico, India and the U.K.
Clearly, the United States remain a destination of choice for investors for its stability, and future prospects.

Separately, but still relevant to this subject, it is good to note that the foreign-born population by state looks like this:
- California: 25.4%
- New York: 10.8%
- Texas: 10.4%
- Florida: 9.2%
- the rest (~44% ) is divided between the other states.

Do you have an input on the subject?  Please let me know.!

Thanks for reading.

Francis

Silicon Valley real estate

Trends: Local prices and graphs.
A noteworthy local non-profit event:  Coalition on Homelessness, SF